The Nigerian Electricity Regulatory Commission (NERC) has published a revision of the multi-year tariff order (MYTO) 2015 and the minimum remittance order (MRO). The increase in end-user tariffs is set to apply from 1 April 2020 and a transition to full cost reflectivity is expected by the end of 2021.
The level of price increase depends on the tariff category and the distribution area, with eleven distributions companies. According to the regulator, tariffs are set to increase by 73% for Abuja Electricity Distribution Company (AEDC) residential customers R3, to reach NGN47/kWh (US$13c/kWh) in April 2020. For the Ikeja Electricity Distribution Company (IKEDC), which serve a part of Lagos State, R3 residential tariffs will increase by 39% to NGN37/kWh (US$10c/kWh) and C3 commercial tariffs by 55% to NGN38/kWh (US$10c/kWh).
A further increase is planned in 2021. However, a federal court in Lagos has already requested distribution companies to maintain current tariffs until the examination of a lawsuit demanding to stop the price hike. The hearing is planned on 20 January 2020.
In 2012, the Nigerian Electricity Regulatory Commission announced the implementation of cost-reflective tariffs (Multi-Year Tariff Order, or MYTO) in order to attract private investments in the power sector. The MYTO led to an average 60% increase in the electricity price between 2008 and 2012. In 2015, the NERC issued revised electricity tariffs for commercial and industrial customers (MYTO 2.1). However, no tariff increase took place since 2015.